January 2016 forex seasonal trade #2: A glittering start to the year
A look at three of the top forex seasonal patterns for January:
#2: Gold shines in January
Gold has declined for three straight years, from the lofty heights of $1700 at the start of 2013 down to $1060 today. But in the last four years, it's been a different story in January as gold has gained an average of 8.39% to start the year.
It extends beyond that as well. Since 2000 the first month of the year is second best on the calendar with an average 2.5% gain. The average gain over 30 years is 0.95%.
Technically, gold has been in a $50 range for the past two months. That's one of the narrowest sustained ranges in recent history. In any situation like that, the trade is usually to go with a break.
Bulls might wish to buy here at $1061 with a stop below the December lows and adding above $1075. That hardly leaves any room for volatility so a small patient trade might be a better strategy.